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2012 Supreme(P&H) 579
2012(3) LAW HERALD (P&H) 2154
IN THE HIGH COURT OF PUNJAB AND HARYANA
[DIVISION BENCH]
Before
The Hon’ble Acting Chief Justice M.M. Kumar
The Hon’ble Mr. Justice Alok Singh
CWP No.13012 of 2005 (O&M)
Pepsico India Holdings Private Limited
v.
State of Punjab & Ors.
{Decided on 27/04/2012}
For the Petitioner(s):Mr. Nageshwar Rao, Sr. Advocate, with Mr. Rohit Khanna, Advocate, Mr. Chetan Chopra, Advocate, Mr. Santosh Krishanan, Advocate, & Mr. Rohit Chandel, Advocate.
Mr. Piyush Kant Jain, Addl. A.G., Punjab.
For the Respondent No.2:Mr. Sarjit Singh, Sr. Advocate, with Mr. M.S. Virk, Advocate.
Market Fee--Petitioner is manufacturer of potato chips by processing potatoes--Therefore, would not fall within the definition of confectioner-- Liable to pay market fee.
Headnote:(A) Punjab Agricultural Produce Markets (General) Rules, 1962, R.16--Levy of Market fee--Admittedly, the petitioner is potato chips manufacturer--Petitioner is storing potatoes in his factory premises, which is situated in the market area within the State of Punjab--Not only this, by processing of the potatoes, petitioner was converting the potatoes into potato chips, therefore, petitioner is covered under Section 6(3) of the Act and has rightly obtained licence--Petitioner is also liable to pay market fee as petitioner failed to prove that either entire cost of potatoes was paid in other States and market fee was also paid on the purchase of potatoes in those States or that potatoes were transported within the State of Punjab by the petitioner himself--Punjab Agricultural Produce Markets Act, 1961, S.23.
The sine quo non to attract Rule 18(1)(a) is that a person should be supplier or dealer (Purveyor) of perched, fried or cooked food. Petitioner is manufacturer of potato chips and cannot be regarded as supplier or dealer of the food, therefore, petitioner is not exempted from taking licence under Section 6 in view of provision of Rule 18(1)(a) of the Rules, therefore, is duty bound and has rightly applied and granted licence under Section 6(3) of the Act.
The question then arises as to whether any market fee can be levied on the petitioner in view of Section 23 of the Act read with Rule 29 of the Rules?
The petitioner has not produced any document on record to say that agreements of sale or purchase of the potatoes were entered in other States and deliveries of potatoes were taken in those States and thereafter the potatoes were transported to the State of Punjab. Petitioner by way of producing evidence could say that entire cost of potatoes was paid in other States and market fee was also paid on the purchase of potatoes in those States. Petitioner has not placed on record any evidence viz. entries on the barriers or builties to prove that potatoes were transported within the State of Punjab by the petitioner himself. In the absence of any material evidence, we are not inclined to accept the arguments of Mr. Rao that agreement to purchase the potatoes was entered outside the State of Punjab, payment was made outside the State of Punjab to the sellers and thereafter potatoes were transported to the State of Punjab by the petitioner on his own. Therefore, adverse inference has to be drawn against the petitioner to say that potatoes were delivered in the factory of Punjab and no duty was paid in the other States, therefore, petitioner is duty bound to pay market fee on such purchases in view of Section 23 of the Act. Moreover, Division Bench of this Court in the Case of The Market Committee, Dhariwal vs. The British India Corporation, Limited & another, 1976 PLJ 525 in paragraph Nos.7 and 8 has held as under: -
(B) Punjab Agricultural Produce Markets Act, 1961, S.6(3)--No person, unless exempted by Rules made under this Act, shall set up, establish or continue or allowed to be continued any place for the purchase, sale, storage and processing of the agricultural produce so notified or purchase, sell, store or process such agricultural produce except under a licence granted in accordance with the provisions of the Act.
(C) Punjab Agricultural Produce Markets Act, 1961, S.23--Petitioner is manufacturer of potatoes chips by processing potatoes--Therefore, would not fall within the definition of confectioner.
Mr. Alok Singh, J.: - In all the writ petitions being CWP No.13012 of 2005 (Pepsico India Holdings Private Limited vs. State of Punjab and others), CWP No.8355 of 2001 (Pepsi Foods Limited vs. State of Punjab and others), CWP No.818 of 2006 (Pepsico India Holdings Private Limited vs. State of Punjab and others) and CWP No.6604 of 2007 (Pepsico India Holdings Private Limited vs. State of Punjab and others) identical questions of law are involved, therefore, all the writ petitions are being heard and disposed of together with the consent of learned counsel for the parties.
2. To understand the controversy, facts of CWP No.13012 of 2005 (Pepsico India Holdings Private Limited vs. State of Punjab and others) are being narrated as under.
3. Petitioner has invoked the extraordinary jurisdiction of this Court under Article 226 of the Constitution of India, assailing the action of the respondents asking the petitioner to pay market fee, rural development fee and penalty thereon.
4. Brief facts of the present case, inter alia, are that petitioner has set up one factory for manufacturing of potato chips at village Channo, District Sangrur, Punjab. The raw material for potato chips is potato, which the petitioner has been procuring within the State of Punjab from other States and from the farmers directly in accordance with the arrangement made under an agreement. The ground of challenge is that since petitioner is engaged in the business of manufacturing and selling potato chips, therefore, he is covered under the expression ‘confectioners and purveyors of parched, fried and cooked food’ as provided in Rule 18 of the Punjab Agricultural Produce Markets (General) Rules, 1962 (hereinafter referred to as ‘the Rules’). The petitioner has claimed that it is exempted from taking licence under Section 6 of the Punjab Agricultural Produce Markets Act, 1961 (hereinafter referred to as ‘the Act’) and in view of Section 23 of the Act, no fee can be levied on the petitioner for purchase of agricultural produce. Another ground of challenge is that since potatoes were purchased in different States and not bought within the State of Punjab, therefore, no market fee can be levied on the petitioner.
5. Respondents have refuted the assertions of the petitioner and have stated that since petitioner himself has obtained license, therefore, petitioner cannot claim that he was not supposed to obtain license and is exempted under Rule 18 of the Rules; since petitioner is engaged in the manufacturing of potatoes chips within the State of Punjab and is storing the potatoes in the factory premises in Punjab, therefore, is liable to pay fee. No evidence is placed on record to prove that entire transaction regarding the purchase of potatoes was completed in other States by paying market fee in those States. The petitioner has failed to prove that potatoes were in fact purchased in different States outside the State of Punjab; petitioner does not fall within the definition of confectioners and purveyors of parched, fried and cooked food.
6. We have heard Mr. Nageshwar Rao, learned senior counsel, for the petitioners, Mr. Sarjit Singh, learned senior counsel for the Marketing Board, and Mr. Piyush Kant Jain, learned Additional Advocate General, Punjab.
7. Mr. Nageshwar Rao, learned senior counsel, for the petitioners, has vehemently argued that in view of Rule 18(1) of the Rules, confectioners and purveyors of parched, fried and cooked food are exempted from taking licence for the purchase of agricultural produce. He has further argued that since petitioner is engaged in the manufacturing and supply of potato chips, therefore, petitioner would fall within the definition of ‘confectioner’ and in any case within the definition of ‘purveyor of parched, fried or cooked food’. He has further submitted that as per Section 23 of the Act, market fee can be levied on the agricultural produce bought or sold by a licencee in the notified market area. He has further ar
